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ZH broke the link. They have noticed that EURUSD has gone down this time not because of EUR weakening, but rather because of USD strengthening (amazing insight, that). They believe that USD has strengthened because everyone has piled into (and continues to pile into) USDJPY (the Japanese...

Right, just like I said previously... It's pointless. In spite of everything I have been saying, you just keep saying the same thing. You call my arguments "amorphous", which, frankly, I don't really understand, as I have been very specific. Here's my last attempt, jem, by way of appeal to...

I am in agreement with you, conceptually. I am just trying to be pragmatic about government, governance, regulations and stuff like that. I just don't think the answer to our ills is anything as extreme as most people like to suggest. Given our current state of development, the solutions are...

Yep, I have been saying for years that, even if there is an issue with derivatives, total gross notional is an pretty meaningless measure of the issue. Mkt value is a better measure. If you want to use precedent and look at the Lehman default, a conservative estimate of the portfolio losses...

Yeah, looks like OP is confounding a few things here... The right rate to use is the funding rate, whatever it might be, in your particular case (not that it matters that much, but anyways).

Firstly, I guess we do have to go into the mechanics of these derivatives. Say, JPM has $70trn notional exposure. Of this, $56trn notional is IR derivatives. To experience a loss of 5% of notional on these derivatives, rates across the curve have to move 5% (and every single trade in the...

While I appreciate the compliment, I fail to see diversions. 1. Again, you seem to be very confused. For the New York Fed to act, the FOMC needs to adopt a decision by majority approval by the voting members. The majority of these voting members are government appointees, as I have...

a. I have read the text in the link, so you don't have to quote it again, really. I am not sure what particular part of the text suggests that "control is illusory". If you're referring to the use of the term "consensus", I have already mentioned that this is, clearly, on the basis of...

Swaptions are not yet exchange-cleared, correct... That's coming, supposedly some time later this year, once the exchanges have all of their systems in place. Moreover, swaptions are only smth like 7% of the total size of the OTC derivatives mkt (by notional and mkt value both). Well, I...

For you, anything, amico Mav, although maybe the patronizing tone is a little overdone. Still, I ain't sore. I am a big boy, I can handle it. 1. I disagree with Rick about his analogy. QE is not like using a firehose to water a tiny geranium plant. The US economy isn't tiny and neither...

But that's exactly my point! Laws, generally, are like laws that apply to drugs. Take an extreme example. If you're a government that makes loads and loads of stupid, unenforceable laws (not suggesting that your suggestions are like that), you're going to end up with a totally screwed up...

On derivatives, it's actually pretty simple. We can talk about why notionals don't make sense, but let's avoid doing that. Of the current outstanding derivatives contracts ($632.6trn notional; $24.7trn mkt value), arnd 80% are actually interest rates products, i.e. interest rate swaps etc...

I have already given you a number of these... How could you have missed them if you actually read the stuff I have written? Of the people on the FOMC, how many are nominated by the President and confirmed by Senate? How many are not? What is the entity that controls, supervises and...

Yep, I only wish I gave you guys the famous line when I went away...

I am back... I am sorry that I disappeared, but I had family matters that required my attention. I am now back and happy to conclude our conversation, if you so desire.

Quite clearly, "consensus" is the wrong word here, given that, at pretty much every meeting, there are dissenters (e.g. George and Bullard at the Jun FOMC), who vote against the policy decisions made. And the whole point of FOMC is to represent, at least symbolically, a mix of public (the...

Erm, no. Could you be kind enough to a) not quote me inaccurately; b) not make statements that are patently untrue? Firstly, like I said the Board of Governors of the Federal Reserve System is a federal government agency in the clearest and most obvious sense. The power to appoint ALL of its...

Not sure about this, tbh... As far as I know, the general principles behind the structure of the boards are the same for all the regional Reserve Banks. Obviously, the particular choices that have been made can be more or less controversial and the NY Fed has done its share of dubious things...

Yeah, so the point I was actually trying to get at was that you need someone to enforce the "full reserve" nature of the banks in this system. Who is the infallible agency that will do this? The government? The bank officials themselves? My analogy with drugs is appropriate here, I...

What's there to update? It's a sh1tshow again, IMF is threatening to pull out (and if they do, the whole deal falls apart). The implementation of austerity is not going according to plan (public sector layoffs not happening and health fund deficit mounting). If that happens, Greece might not...